MPI on course for another year of record earnings

KUALA LUMPUR: Fresh off record earnings in FY21, Malaysian Pacific Industries Bhd could be poised for yet another earnings high in FY22 given the robust demand for chips in data centres and automative spaces.

"The management continues to exhibit top-notch execution with record breaking results amidst the sporadic relaxation or tightening of movement control and lockdown.

"We believe the group is capable of continuing the growth trend entering into FY22 as demand for chips remains strong around the world," said Kenanga Research in a note.

It added that the group continues to experience high demand for its power management chip packaging service as data centres are starting to see the need for expansion due to higher bandwidth usage among consumers working from home.

Demand for bandwidth will only increase further with the adoption of 5G, it added.

Kenanga expects MPI to be ready to take on tremendous growth in the automotive space as it has positioned itself to be automotive centric.

"From our channel check, many automotive IDMs are securing wafer supply for up to two years with a non-cancellation clause.

"This will eventually trickle down to the OSAT space and MPI will be ready to take on more packaging jobs," it said.

The research house maintained "outperform" on MPI with a higher target price of RM56.20 based on 35x price-earnings ratio on higher projected 2022 earnings per share.
Article type: metered
User Type: anonymous web
User Status:
Campaign ID: 46
Cxense type: free
User access status: 3
Join our Telegram channel to get our Evening Alerts and breaking news highlights

Next In Business News

KLK extends IJM Plantations MGO to Nov 18�
Supermax seeks details from US over forced labour allegations
Ringgit closes higher against US dollar at 4.1565
Profit taking weighs on Bursa
Lawyer Sreesanthan settles SC charges for insider trading
Supermax shares fall to low of RM2 over alleged labour abuses
Oil falls as investors take profits, but fuel switching caps losses
Birkin bag maker Hermes shrugs off China slowdown, sales beat forecasts
Thai PTT Global Chemical plans US$22b investment by 2050 to decarbonise
Australia shares end almost flat as Evergrande worries weigh on miners

Others Also Read